About the F1 Resource Restriction Agreement

[Dragonfly]

Nick wirth statement on autosport show:
...............
Virgin may not have access to a windchannel but they claim to be ruling the block in CFD...

At the opposite end of the grid, I'd say

[WhiteBlue]

As for the Resource Restriction Agreement, it is an agreement between the FOTA teams - I think a glorified gentlemans agreement. As gentlemens agreement have no legal worth they are generally pointless.

Your opinion seems to be contrary to the facts. The RRA is legally binding, just like the concord agreement Source. Is has been designed that way from day one as we know by comments from Adam Parr. Source

[timbo]

Your opinion seems to be contrary to the facts. The RRA is legally binding, just like the concord agreement Source. Is has been designed that way from day one as we know by comments from Adam Parr. Source

For once, there's nothing that tells that FIA is involved (other than they confirmed something). It might be just like Concorde Agreement, where few teams participated for a number of years without signing it.
There's also no info about penalties involved in overspending. It might be that they loose Bernie's money or something.
So, it might be just like Concorde Agreement — legally binding, but one can be in F1 without signing it, if one wishes.

[747heavy]

not sure it´s "legally binding" (it may well be), but it´s a bit of an "paper/toothless tiger" - IMHO.
From your sources is appears, that it was the intention to make it a legally binding agreement, not sure it has meanwhile reached this point, as there seems still a bit of armwrestling going on about some details. (work force, engine R&D budgets)

What´s the consequence if one is not conforming with it?
"Oh then you have to spend even less next year" - sorry that´s a joke.
If one team decides to leave the sport anyway (maybe 2013), it still can try to "buy"/spend it´s way to the title. It want be around to worry about it´s lower budget for next year.

As long, as they don´t dock them points in the constructor championship, and therefore FOM money, I would agree with Andrew, it´s a "gentlemen agreement".
Similar to the "we will not use KERS in 2010" deal.

As the first team has allready left FOTA, it´s a question of time before others will follow, if they see a benefit from it.
Could be as soon as Bernie is promissing some extra money again, as we have seen in the past.
The new Concord agreement is not signed of yet, neither is the extended version of the RRA (AFAIK).

[horse]

Nick wirth statement on autosport show:

"... I know that if we did one day of wind tunnel testing then we would be breaking the rules."

Virgin may not have access to a windchannel but they claim to be ruling the block in CFD...

Not one single validation of their results. Unbelievable madness.

[marcush.]

the pure CFD approach is a two sided sword development pace is a lot higher (if you have ideas to investigate ..and not just iterating endless minute changes maybe in an area not very important to overall performance ...
and it will of course take your project quickly into a direction (not much in terms of lead time as you won´t have to produce scale parts and test them in the channel first.
so on one hand it will derail your aero development quickly ..when parameters are wrong but on the other hand you will quickly realise when your sim does not match reality...
I´m pretty sure Virgin will gain tremendous expertise with this approach ...and as soon they have found a good base to work from I see the potential of this line of thought.

[WhiteBlue]

It might be just like Concorde Agreement, where few teams participated for a number of years without signing it.
There's also no info about penalties involved in overspending. It might be that they loose Bernie's money or something.
So, it might be just like Concorde Agreement — legally binding, but one can be in F1 without signing it, if one wishes.

Source
This (the resource restriction agreement) is between the teams. The FIA is not involved. So, a violation will not affect the results. If a team has spent too much, the agreement provides that it has to spend less in subsequent years.

Why don't you people read the sources? The RRA is legally binding, has been signed by all teams and over spending is punished by reduced budgets in the following years, on a sliding scale. These facts are all confirmed by quotes from FOTA members.

[WhiteBlue]

What´s the consequence if one is not conforming with it?
"Oh then you have to spend even less next year" - sorry that´s a joke.
If one team decides to leave the sport anyway (maybe 2013), it still can try to "buy"/spend it´s way to the title. It want be around to worry about it´s lower budget for next year.

As long, as they don´t dock them points in the constructor championship, and therefore FOM money, I would agree with Andrew, it´s a "gentlemen agreement".
Similar to the "we will not use KERS in 2010" deal.

As the first team has allready left FOTA, it´s a question of time before others will follow, if they see a benefit from it.
Could be as soon as Bernie is promissing some extra money again, as we have seen in the past.
The new Concord agreement is not signed of yet, neither is the extended version of the RRA (AFAIK).

Legally binding means that a violator may be subject to arbitration and can be sued before a court of law. Very likely he can also be excluded from the next championship by the FiA.

Common sense should tell us that teams will not normally compete at the front of the championship and leave the next year. What the back markers like HRT do is of no consequence. They will never violate the RRA.

The present Concord Agreement is valid until the end of 2012 and the RRA is also valid until that day. A framework to extend the RRA and relax it from this year has been agreed but details remain unresolved, particularly a separate engine RRA. This is why the more restrictive valid version remains applicable until the final extension until 2017 is signed.

IMO it is Bernie and FOM who are in a pinch if they don't manage to sign a new Concord in the next 23 month. If they don't the teams can automatically break away and do their own championship. I actually think that the first internal dead line is much earlier. If they do not come to an agreement in the next six months FOTA will start the preparations for a break away. They have to unless they risk to be caught out unprepared. From there it will escalate and have very negative impact on the valuation of FOM. CVC cannot risk that scenario. They need a clean exit with a valuation of $5-6 billion. Anything else would be unthinkable.

[andrew]

As for the Resource Restriction Agreement, it is an agreement between the FOTA teams - I think a glorified gentlemans agreement. As gentlemens agreement have no legal worth they are generally pointless.

Your opinion seems to be contrary to the facts. The RRA is legally binding, just like the concord agreement Source. Is has been designed that way from day one as we know by comments from Adam Parr. Source

Your sources don't confirm anything. At the moment there seems to be no involvement by the FIA in the RRA and it still seems a toothless handshake agreement with nothing to stop teams from overspending. In other words, the RRA is completely pointless as there seems to be no mechanism for enfocring it.

[timbo]

Why don't you people read the sources? The RRA is legally binding, has been signed by all teams and over spending is punished by reduced budgets in the following years, on a sliding scale. These facts are all confirmed by quotes from FOTA members.

FWIW Toyota signed Concorde last year and was out of F1.
There are different amounts of legal binding it seems

[WhiteBlue]

Your sources don't confirm anything. At the moment there seems to be no involvement by the FIA in the RRA and it still seems a toothless handshake agreement with nothing to stop teams from overspending. In other words, the RRA is completely pointless as there seems to be no mechanism for enfocring it.

I disagree. Your problem is denial. There is enough evidence to show the RRA can be enforced before a a court of law or in an arbitration. Post any comment you like, it will not change the facts.

Why don't you people read the sources? The RRA is legally binding, has been signed by all teams and over spending is punished by reduced budgets in the following years, on a sliding scale. These facts are all confirmed by quotes from FOTA members.

FWIW Toyota signed Concorde last year and was out of F1. There are different amounts of legal binding it seems

So what? I'm sure FOM had some legal handle to force Toyota but they decided not to use it publicly. When a team does not want to race there is very little FiA, FOM or FOTA can do about it. They usually pocket the money and disregard it. But leaving isn't the issue of this thread. This is about the RRA and cost control. There will probably never be a perfect system but the RRA is the nearest F1 can come to something that works as a cost break, considering that Ferrari will shoot down each attempt at a real budget cap.

[Ciro Pabón]

No, my problem is not denial. No, no and no. And no. What you meant is: "The problem with your post is one of denial" although I'll deny it.

If a team retires, there is little FOM can do. Perhaps they'll take away the 40 million dollars you have to pay in advance, or retain your share of the benefits, which they pay at the end of the season, but, hey, who doesn't have 60 millions dollars to spare? Dollars are cheaper by the day, over all in F1, the "poor man" sport by excellency.

Sponsor agreements can be canceled without problem, you just refuse to honor the contracts and their lawyers will give you a pat in the back.

Driver representatives will smile full of understanding and they will throw away the contracts. Little they can do, sure, you know lawyers. They are a charming lot.

Same goes for your engineers and team directors. Rarely if ever they have multiannual contracts and if they do, they will be the lighthouse of understanding.

Facilities? What facilities? Labor is so cheap these days and in Europe is very easy to dismiss an employee...

Taxes... well, no problem. Internal Revenue is your friend indeed.

[timbo]

There is enough evidence to show the RRA can be enforced before a a court of law or in an arbitration. Post any comment you like, it will not change the facts.

Umm so evidence = fact?
'Cause y'know had a team been taken to the court via RRA or banned from F1 — that would be a fact.

Can FIA ban team from participating in F1 because it has broken RRA? I don't know. And you don't know too.

[andrew]

Your sources don't confirm anything. At the moment there seems to be no involvement by the FIA in the RRA and it still seems a toothless handshake agreement with nothing to stop teams from overspending. In other words, the RRA is completely pointless as there seems to be no mechanism for enfocring it.

I disagree. Your problem is denial. There is enough evidence to show the RRA can be enforced before a a court of law or in an arbitration. Post any comment you like, it will not change the facts.

My problem is not denial so enough with the amatuer drug-store psychology. I merely disagree with your oppinion that the RRA and FIA are a pair of knights in shining armour that will ride in and save F1.

The RRA as it stands is totally unenforcable. As with MrM and Red Bull it is claim against counter claim. As usual, MrM is trying to create trouble in FOTA and worm his way back into his old job. He has no way of proving his claims against Red Bull but is clearly hoping to fling enough mud and hoping that some of it will stick. On the other hand, if Red Bull have overspent then I am sure they can cover this up with some creative accounting, depending on the amount of overspend. The RRA is a joke until it can correctly policed, which it can't right now.

[ESPImperium]

I see the new Concorde Aggreement being a telling one. there will be as many as 5 factions fighting for the money;

Faction 1: FOTA - They are wanting there to be a narrowing in the moneys given to the teams accross the board, but they want more money from FOM from the TV budget.

Faction 2: FOM - They need to service the $3.2m debt that has been left from the early 2000 from the CVC era, and want the teams to take less money.

Faction 3: FIA - They are seemingly wanting more money from FOM in other ways, in effect they could only supply staff to F1 each weekend, leaving GP2 and GP3 without staff and services each weekend, they want more money from FOM to supply theese each weekend as FOM owns GP2 and GP3. The FIA are already looking for replacements to GP2 and GP3 for the F1 support races.

Faction 4: Track Promotors - There has been a long mooted Track Promotors Associasion being founded as they would like some of the TV money to prop the tracks up, some track promotors are wanting each F1 race to be levied at a standard fee so they can all make a decent living at the end of the day as some tracks pay $17m a race others pay $27m a race.

Faction 5: GPDA - The drivers are wanting more say in the way track design is in the future and also they are wanting to have more say on the saftey aspects on regulation and they way some of the regulations are decided.

Im gonna say that an almighty reshuffle is on the way with FOM getting its marjins made smaller and they way it does buisness remodeled. However i can see the teams giving up alot of ground as well, i can see a stricter RRA in place, but there will also be consessions as well.

Personally id like to see teams being run like a buisness, unlimited computing power but their wind tunnels only being allowed to run for 14 days each year, but if a team wishes to trade a day of wind tunnel testing for a days real world testing at a track that isnt on the F1 callander that year would go down well. Or something like it would go down well. Also larger teams have to be able to supply technology for a decent price, like $2m for a seasons supply of gearboxes or KERS for example. I can also see engine manufacturers being limited to supplying 1 additional team if they have a works team, thus creating new or existing (Cosworth) engine manufacturers to come in and supply up to 3 teams for example.

I can see F1 changing massivly in the next 2-3 years. Its gonna be tighter, more restrictive in terms of finance and ammount of staff at teams, but ultimatly there will be more room to move in the regulations as a posible result.